Manhattan Hardware Co. v. Phalen

Citations

• 128 Pa. 110
• 18 A. 428
• 1889 Pa. LEXIS 773

Syllabus

<p>1. The liabilities of a manufacturing corporation accruing in the improvident of its property, the employment of labor, or the purchase of materials in the prosecution of its ordinary business, do not constitute such an increase of indebtedness, as, under § 7, article XVI. of the constitution and the act of April 18, 187á, P. L. 61, requires a previous meeting and consent of stockholders to validate them.</p> <p>2. When a corporation receives the benelit of money borrowed on a corporate mortgage, and the stockholders know of it and make no objection within a reasonable time to the lack of authority in the corporate officers to make the loan, neither the corporation, its stockholders, nor its creditors can set up such want of authority in a suit on the mortgage, nor can the receiver of the company do so for them.</p> <p>8. Where the mortgage of a manufacturing corporation, executed under the corporate seal, recited a resolution of the directors that it was unanimously authorized by the stockholders, an affidavit of defence to a scire facias thereon, averring that the mortgage was not authorized by the stockholders, and that no stockholders’ meeting had been called upon the subject, was insufficient to prevent summary judgment.</p>